UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the quarterly period ended July 31, 2006
Commission File Number
0-33473
VIRIDAX CORPORATION.
(Name of Small Business Issuer in its charter)
FLORIDA 65-1138291
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification No.)
270 NW 3rd Court 33432-3720
Boca Raton, Florida (Zip Code)
(Address of principal executive offices)
Issuer's Telephone: (561) 368-1427
----------------------------------
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter
period that the registrant was required to filed such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes |X| No |_|
Indicate by checkmark whether registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes |_| No |X|
APPLICABLE ONLY TO CORPORATE ISSUERS
As of July 31, 2006, there are 24,318,090 shares
of common stock outstanding.
Transitional Small Business Format: No
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Unaudited financial statements for Viridax Corporation as of the fiscal
quarter ended July 31, 2006 are submitted in compliance with Item 310(b) of
Regulation S-B.
VIRIDAX CORPORATION
(A Development Stage Company)
BALANCE SHEET
JULY 31, 2006
(Unaudited)
ASSETS
CURRENT ASSETS
Cash $ 18,728
Note receivable and accrued interest - related
party 11,904
-----------
Total Current Assets 30,632
COMPUTER EQUIPMENT - NET 3,277
OTHER ASSET
Bacteriophage material 2,000,000
-----------
TOTAL ASSETS $ 2,033,909
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 42,366
-----------
STOCKHOLDER'S EQUITY
Class A non-cumulative, convertible preferred
stock, $1 par value, 3,000,000 shares authorized,
10,500 shares issued and outstanding 10,500
Common stock, $.001 par value, 50,000,000
shares authorized, 24,318,090 shares issued
and outstanding 24,318
Additional paid-in capital 2,620,429
Deficit accumulated during the development stage (663,704)
-----------
Total Stockholders' Equity 1,991,543
-----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,033,909
===========
Read accompanying Notes to Financial Statements.
F-1
VIRIDAX CORPORATION
(A Development Stage Company)
STATEMENTS OF OPERATIONS
(Unaudited)
Period From
July 1, 1998
Three Months (Inception)
Ended July 31, To July 31,
2006 2005 2005
------------ ------------ ------------
REVENUES $ -- $ -- $ 735
EXPENSES
General and administrative 91,423 94,880 664,439
------------ ------------ ------------
NET (LOSS) $ (91,423) $ (94,880) $ (663,704)
============ ============ ============
(LOSS) PER SHARE - BASIC AND DILUTED $ -- $ -- $ (.05)
============ ============ ============
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 24,313,653 15,667,384 12,281,621
============ ============ ============
Read accompanying Notes to Financial Statements.
F-2
VIRIDAX CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
Period From
Three Three July 1,1998
Months Ended Months Ended (Inception)
July 31, July 31, to July 31,
2006 2005 2006
------------ ------------ ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (loss) $ (91,423) $ (94,880) $ (663,704)
Adjustments to reconcile net (loss) to net
cash (used in) operating activities:
Depreciation 322 -- 638
Common shares issued for services rendered -- -- 5,000
Conversion of accrued interest to
additional paid-in capital -- -- 576
(Increase) in accrued interest receivable (155) -- (204)
Decrease in miscellaneous receivable 511 -- --
Increase in accounts payable 35,750 2,542 42,366
------------ ------------ ------------
NET CASH (USED IN) OPERATING ACTIVITIES (54,995) (92,338) (615,328)
------------ ------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of computer equipment (488) -- (3,915)
Increase in note receivable (7,700) -- (11,700)
Increase in loans receivable - stockholder -- -- (12,000)
Repayment of loans receivable - stockholder -- -- 4,000
------------ ------------ ------------
NET CASH (USED IN) INVESTING ACTIVITIES (8,188) -- (23,615)
------------ ------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock 12,750 107,500 599,701
Issuance of preferred stock 36,750 -- 36,750
Increase in amount due to stockholder -- -- 16,220
Proceeds of note payable -- -- 5,000
------------ ------------ ------------
NET CASH PROVIDED BY FINANCING ACTIVITIES 49,500 107,500 657,671
------------ ------------ ------------
NET (DECREASE) INCREASE IN CASH (13,683) 15,162 18,728
CASH - BEGINNING 32,411 36,106 --
------------ ------------ ------------
CASH - ENDING $ 18,728 $ 51,268 $ 18,728
============ ============ ============
Read accompanying Notes to Financial Statements.
F-3
VIRIDAX CORPORATION
(A Development Stage Company)
STATEMENTS OF CASH FLOWS
(Unaudited)
Period From
Three Three July 1,1998
Months Ended Months Ended (Inception)
July 31, July 31, to July 31,
2006 2005 2006
------------ ------------ ------------
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING
AND FINANCING ACTIVITIES:
Common shares issued for services rendered $ -- $ -- $ 5,000
============ ============ ============
Common shares issued for purchase
of bacteriophage material $ -- $ -- $ 2,000,000
============ ============ ============
Conversion of net stockholders loans to
additional paid-in capital $ -- $ -- $ 13,796
============ ============ ============
Read accompanying Notes to Financial Statements.
F-4
VIRIDAX CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2006
NOTE 1. ORGANIZATION
Viridax Corporation was incorporated on July 1, 1998 under the laws of
the State of Florida as Media Advisory Group, Inc. and on August 6, 2001
changed its name to I & E Tropicals, Inc. On April 5, 2005, the company
amended its Articles of Incorporation to change its name to Viridax
Corporation. With the acquisition of the bacteriophage material on April
24, 2005, the Company is pursuing its plan to expedite the bacteriophage
material's commercialization. This bacteriophage material is expected to
be used for the treatment of bacterial infections incited by
Staphylococcus aureus and other Staphlylococcus species. The Company has
decided to discontinue its original business plan for the importing and
exporting of exotic marine life. The company's headquarters is in Boca
Raton, Florida.
The Company has insignificant revenue to date. Since its inception, the
Company has been dependent upon the receipt of capital investment or
other financing to fund its continuing activities. In addition to the
normal risks associated with a new business venture, there can be no
assurance that the Company's product development will be successfully
completed or that it will be a commercial success.
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying condensed financial statements are unaudited. These
statements have been prepared in accordance with the rules and
regulations of the Securities and Exchange Commission (SEC). Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been
F-5
VIRIDAX CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2006
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
Basis of Presentation (Continued)
condensed or omitted pursuant to such rules and regulations. In the
opinion of management, all adjustments (which include only normal
recurring adjustments) considered necessary for a fair presentation have
been included. These financial statements should be read in conjunction
with the Company's financial statements and notes thereto for the year
ended April 30, 2006, included in the Company's Form 10-KSB as filed
with the SEC. The results of operations and cash flows for the period
are not necessarily indicative of the results of operations or cash
flows that can be expected for the year ending April 30, 2007.
(Loss) Per Share
Basic and diluted (loss) per share is based on the weighted average
number of common shares outstanding. The effect of the conversion of the
preferred stock is excluded from the calculation of net loss per share
as the effect was anti-dilutive.
Use of Estimates
Management uses estimates and assumptions in preparing financial
statements in accordance with generally accepted accounting principles.
Those estimates and assumptions affect the reported amounts of assets
and liabilities, the disclosure of contingent assets and liabilities,
and the reported revenues and expenses. Accordingly, actual results
could vary from the estimates that were assumed in preparing the
financial statements and those differences could be material.
F-6
VIRIDAX CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2006
NOTE 3. RELATED PARTY TRANSACTIONS
Notes Receivable and Accrued Interest
During the three months ended July 31, 2006, an additional $7,700 was
advanced to a company, the president of which is the president of the
Company. The note is unsecured, bears interest at 6% per annum and is
due on demand. The total notes receivable balance as of July 31, 2006
includes accrued interest of $204.
Legal Fees
During the three months ended July 31, 2006 and 2005, $15,000 and
$18,750, respectively, was charged by a stockholder for legal services
rendered. As of July 31, 2006, the amount due this stockholder was
$15,000 and is included in accounts payable.
NOTE 4. CAPITAL STOCK
The Company has 3,000,000 shares of Class A non-cumulative, convertible
preferred stock of $1 par value authorized. The preferred shares are
non-cumulative, non-voting and convertible to common shares during the
first 3 years under the following schedule: shares converted within the
first year of purchase shall receive 4 shares of common for every share
of preferred; shares converted within the second year after purchase
shall receive 4.4 shares of common for every share of preferred; shares
converted within the third year after purchase shall receive 4.6 shares
of common for every share of preferred; after 3 years of ownership, the
shareholder shall receive 5 shares of common for every share of
preferred, but the right to convert must be exercised within 30 days
after the third year anniversary of purchase or the conversion right
will lapse.
F-7
VIRIDAX CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2006
NOTE 4. CAPITAL STOCK (CONTINUED)
On April 1, 2006, the Company entered into an Agency Agreement for the
sale of up to 3,000,000 shares of the Company's Class A Preferred Stock.
The stock is being offered for sale in Germany and elsewhere in Europe
at $7 per share ($3.50 per share net proceeds to the Company), as
determined by the Company's management, such sale being exempt from
registration under Regulation S of the Securities Act of 1933.
During the three months ended July 31, 2006, 10,500 preferred shares
were sold for net cash of $36,750.
As of July 31, 2006, 10,500 preferred shares were issued and
outstanding.
The Company has 50,000,000 shares of $.001 par value common stock
authorized. Shareholders of common stock have one vote per share.
On April 12, 2006, the Company entered into a Stock Purchase Agreement
for the sale, on a best efforts basis, of an aggregate of 1,000,000
shares of common stock for $1 per share, as determined by the Company's
management, such sale being exempt from registration under Regulation S
of the Securities Act of 1933. The Agreement provides for the purchase
of the shares at irregular intervals. During the three months ended July
31, 2006, 12,750 common shares were sold for cash totaling $12,750.
Subsequent to July 31, 2006, 10,000 common shares were sold for cash
totaling $10,000.
As of July 31, 2006, 24,318,090 shares of common stock were issued and
outstanding.
F-8
VIRIDAX CORPORATION
(A Development Stage Company)
NOTES TO FINANCIAL STATEMENTS
JULY 31, 2006
NOTE 5. SUBSEQUENT EVENTS
On August 14, 2006, the Company received a loan of $6,000 from a
company, the president of which is the president of the Company. The
loan is unsecured, bears interest at 6% per annum and is due on demand.
NOTE 6. GOING CONCERN
As reflected on the balance sheet, the Company does not have sufficient
working capital to carry it through the next twelve months. This factor
raises substantial doubt about its ability to continue as a going
concern. The ability of the Company to continue as a going concern is
dependent on its ability to raise additional capital. The financial
statements do not include any adjustments that might be necessary should
the Company be unable to continue as a going concern.
With the recent Agency Agreement and Stock Purchase Agreement in place
for the sale of preferred and common stock, respectively, and the recent
approval for the sale of preferred stock on the German exchange,
management believes the Company will have sufficient working capital to
be able to continue as a going concern.
F-9
ITEM 2. PLAN OF OPERATION
The Company's Plan of Operation for the next twelve months is to acquire
adequate laboratory space to continue the development of high value
biopharmaceutical products, to complete a contractual relationship with a
manufacturing facility to produce the Company's first Staph phage product in
compliance with USFDA guidelines, to commence preclinical and clinical testing,
and to obtain the financing necessary to achieve these objectives. In addition,
Viridax intends to initiate an intellectual property strategy and program, and
to engage the services of one or more key scientists to formulate and initiate
the technology strategic plan.
The Company has engaged the services of Speckman Law Group, a
biotechnology intellectual property law firm in Seattle, Washington (SLG). SLG
has initiated key science literature searches and prior art patent searches to
evaluate the baseline of information related to the Company's anticipated new
intellectual property strategy. In addition, SLG has completed searches and has
filed Trademark applications to protect the Company's name and logotype, and to
assure there is no conflict regarding the Company's proposed product names. The
engagement of SLG, and SLG's new Intellectual Property and scientific literature
work assignments, preclude the need for additional consulting work as was
performed previously by an outside consultant.
Viridax plans to engage the services of several key scientists having
specific experience in the fields of Bacteriophage biology and therapeutics. The
Company intends to engage the scientists as full-time employees of Viridax upon
completion of the current financing. Each scientist employed is anticipated to
hold a PhD degree and have direct experience in the discovery and development of
therapeutic bacteriophages.
Viridax continues to negotiate a lease agreement for finished laboratory
and office space in Bothell, WA (Canyon Park Bothell, WA). The targeted space is
approximately 5,000 square feet consisting of about 4,000 square feet of fully
configured laboratory space and about 1,000 square feet of office space. The
space was built to specifications and occupied by a biotechnology firm that
moved to expansion space in Seattle, WA. The laboratory space is fully founded
with laboratory benching, air, water and gas fixtures, appropriate power for the
required laboratory equipment, built-in walk-in refrigerators, built-in media
and autoclave equipment, hepafiltered air supply, separate contained laboratory
spaces and secured access. The subject laboratory and office space remain
available to the Company, and the Company intends to execute the said lease upon
completion of the current financing.
2
Viridax continues with its discussions and proposals for collaborations
with government agencies and private biopharmaceutical firms in Russia, Hungary
and Romania. The Russian firm has proposed to provide preclinical testing
services, manufacturing operations and clinical trials resources for the Viridax
products as part of its package of offerings for negotiation. Similarly,
government and private company representatives in both Hungary and Romania
express their continued interest in collaborating with Viridax, and Viridax
continues to explore the various scientific, manufacturing and marketing
opportunities that could be available as a result of negotiating and executing
mutually beneficial collaborative agreements. Additional, due-diligence
evaluations, proposals and counterproposals are in process, with regard to these
emerging technology and business opportunities. Subsequent to the last report
there have been additional and ongoing positive communications between Viridax
and the Russian, Hungarian and Romanian representatives, and additional meetings
are anticipated. However, no final arrangements have been agreed upon at this
time .
A long-range objective of Viridax Corporation is to bring forward a series
of high value biopharmaceutical products based on the development of new and
modified bacteriophages including certain proprietary delivery technologies.
While the Company has the option of taking its bacteriophage therapy to foreign
countries, such as phage therapy centers now operating in the Republic of
Georgia and in Mexico, the Company has decided to gain approval under the United
States federal and state regulations in order to market its products initially
in the US. As a consequence, until all required testing is completed and final
approvals obtained, the Company will not expect any revenue stream. It does,
however, expect that funding from sales of its stock will be sufficient to
maintain the Company until revenues in the United States may be obtained. There
can be no assurance that the anticipated stock sales will be realized as
anticipated. If required, the Company may seek funds in the form of loans.
However, the Company has not entered into any loan agreements at this time, and
there is no assurance that adequate, or any, loans could be obtained that would
be sufficient to continue operations
At the present rate of expenditures, the Company estimates that it has
funds on hand to continue operations for the next four months without further
revenues. However, a prospectus for the public sale of 3,000,000 shares of the
Company's Class A Preferred Stock has been approved by the German Federal
Financial Supervisory Authority (BaFin). The Company anticipates sales of this
stock to commence almost immediately at a price of US $7 per share (US $3.50 per
share net to the Company) (See Part II, Item 2). The Company also anticipates
sales of its Common Stock pursuant to an agreement with Innovative Strategies
(See Part II, Item 2).
Subsequent to July 31, 2006, the Company has sold 10,000 shares of common
stock for $10,000 cash. There is no assurance that the anticipated sales as
described above will be realized.
The Company has its President as its present sole full-time salaried
employee. While the Company does anticipate hiring additional employees, no
decisions have been made by the Board of Directors at this time.
3
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act and Section 21E of the Exchange Act. We have
based these forward-looking statements largely on our current expectations and
projections about future events and financial trends affecting the financial
condition of our business. These forward looking statements are subject to a
number of risks, uncertainties and assumptions, including, among other things:
o Our ability to obtain capital;
o Our ability to fully implement our business plan;
o General economic and business conditions, both nationally and
in our markets;
o Our expectations and estimates concerning future financial
performance, financing plans and the impact of competition;
o Anticipated trends in our business;
o Other risk factors set forth under "Other Risk Factors" in
this report.
In addition, in this report, we use words or phrases such as "high value",
"plans," "expects," "future," "intends," and similar expressions to identify
forward-looking statements.
We undertake no obligation to update publicly or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise after the date of this report. In light of these risks and
uncertainties, the forward-looking events and circumstances discussed in this
report may not occur and actual results could differ materially from those
anticipated or implied in the forward-looking statements.
ITEM 3. CONTROLS AND PROCEDURES
Under the supervision and with the participation of management, including
the Chief Executive Officer, as the primary Executive Officer, we evaluated the
effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rule 13a-15(e) under the Securities Exchange Act of
1934 (the "Exchange Act")). Based on that evaluation, our Chief Executive
Officer has concluded that, as of the end of the period covered by this report,
our disclosure controls and procedures are adequately designed to ensure that
the information required to be disclosed by us in the reports we file or submit
under the Exchange Act is recorded, possessed, summarized and reported, within
the time periods specified in the applicable rules and forms. During the period
covered by this Quarterly Report on Form 10-QSB, there was no change in our
internal control over financial reporting (as defined in Rule 13a-15(f) under
the Exchange Act) that materially effected, or is reasonably likely to
materially effect, our internal control over financial reporting.
4
PART II
ITEM 1. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
On April 24, 2005 the Company executed an Asset Purchase Agreement with
Mycobis Corporation, a private company, whereby Viridax purchased certain
bacteriophage-based products in exchange for 2,000,000 shares of its common
stock. A copy of this Agreement is provided as Exhibit (3)(1)(d) at Page Number
E-9. The Company claimed exemption from registration pursuant to Section 4(2) of
the Securities Act of 1933, as amended, (the "Act") as being a transaction by
the issuer not involving any public offering. In consideration of the factors in
determining whether a transaction is a public offering, such factors being (1)
the number of the offerees and their relationship to each other and to the
issuer, (2) the number of units offered, (3) the size of the offering, (4) the
manner of the offering, the Company takes the position that because the number
of offerees was one, the shares as issued were restricted, and the manner of the
offering was a business transaction under direct negotiation between the two
parties, no public offering was involved.
By approval of the Board of Directors, on April 15, 2005 the Company sold
25,000 shares of its common stock to an unrelated non-affiliated individual for
the cash price of $25,000.00 and on April 29,2005 the Company sold 15,000 shares
of its common stock to an unrelated non-affiliated individual for the cash price
of $15,000.00. In both situations, the Company claims an exemption under Section
4(2) of the Act, based on the factors as set forth above, the Company takes the
position that these two separate sales were sales not involving a public
offering, The purpose of the 4(2) exemption was to permit an issuer to make a
specific or isolated sale of its securities to particular persons without
incurring the expense of registration. That is precisely the situation in the
sales identified above to sophisticated investors.
On June 1, 2005 the Company entered into a Stock Purchase Agreement with
Mason-Fenway, a Seychelle Islands Corporation, for the sale of up to 500,000
shares of its common stock. A total of 357,167 shares of common stock were sold
in various increments at a cash price of $1.00 per share. No commissions were
paid. The Stock Purchase Agreement was terminated April 25, 2006. The Company
claimed an exemption from registration under Regulation S, as promulgated by the
Securities and Exchange Commission. The facts relied upon to claim an exemption
under Regulation S are: (1) the offer and sale of the shares was made in an
offshore transaction because the purchaser was not a person within the United
States and when all purchases were made the purchaser was outside the United
States, (2) there were no directed selling efforts because the shares were all
sold to a single entity and the consideration of activities to condition the
market with respect to the stock being sold was inapplicable. The Company comes
within the Category 2 safe harbor as set forth in Rule 903(c)(2) because the
sale of the common stock complies with the general conditions of Rule 903(a) and
(b) and the stock certificates bear restrictive legends that meet the Regulation
S selling restrictions in terms of transactional restrictions and offering
restrictions.
5
On July 1, 2005 the Company entered into a Stock Purchase Agreement with
Rowland Associates, A BVI limited company, for the sale of 400,000 shares of its
common stock. A total of 188,173 shares were sold in various increments at a
cash price of $0.80 per share amounting to a total cash price of $153,476
(rounded). No commissions were paid. The Stock Purchase Agreement was terminated
on April 25, 2005. The Company claimed an exemption from registration under
Regulation S, as promulgated by the Securities & Exchange Commission. The facts
relied upon to claim the Regulation S exemption and the Category 2 safe harbor
are identical to the facts as specified above in respect to the offer and sale
of the common stock with Mason-Fenway.
On March 31, 2006, the Board of Directors of Viridax Corporation approved
the efforts of the Company in filing with the German Federal Financial
Supervisory Authority (BaFin) a sales prospectus providing for the sale at US $7
per share of up to the authorized limit of 3,000,000 shares of its Class A
Preferred Stock, Par Value $ 1.00 per share, pursuant to the rules and
requirements of Regulation S as promulgated by the United States Securities and
Exchange Commission. Pursuant to the terms of that prospectus, East Slope
Funding Corp., a Colorado corporation, has been designated as the Escrow Agent
to receive the gross proceeds as paid by a given subscriber and to pay the net
sum of US $3.50 per share to the Company and deliver a copy of the purchaser's
subscription agreement. Under this arrangement, and within exemptions from the
requirements of the prospectus, 10,500 shares have been sold to eight
individuals for a total cash consideration of $36,750. No sales commissions were
paid. Final approval of the prospectus by the BaFin has now been obtained.
The Company claimed an exemption from registration under Regulation S
based upon the following facts: (1) the offer and sale of the shares to each
individual purchaser was an offshore transaction because each purchaser was a
resident of Germany at the time of the transaction and located within that
country, (2) there were no directed selling efforts and no activities were
undertaken to condition the market. The Company comes within the Category 2 safe
harbor as set forth in Rule 903(c)(2) because the sale of the preferred stock
complies with the general conditions of Rule 903(a) and (b) and the stock
certificates bear restrictive legends that meet the Regulation S selling
restrictions in terms of transactional restrictions and offering restrictions.
The Class A Preferred Stock is non-cumulative and non-voting. Each share
of Preferred Stock is convertible to Common Stock as follows: (1) if the owner
wishes to exchange the certificate within one year from the date of purchase,
that owner shall receive four shares of Common Stock for each one share of
Preferred Stock, (2) if the owner wishes to exchange the certificate after
owning it for a period longer than one year but less than two years, the owner
shall receive 4.4 shares of Common Stock for each one share of Preferred Stock,
(3) if the owner wishes to exchange the certificate after owning it for a period
longer than two years but less than three years, the owner shall receive 4.6
shares of Common Stock for each one share of Preferred Stock, and (4) if the
owner wishes to exchange the certificate after owning it for three years, that
owner shall receive five shares of Common Stock for each one share of Preferred
Stock. Once an owner has owned the Preferred Stock for three years, the option
to convert to Common Stock must be exercised within 30 days thereafter or the
conversion option shall lapse.
6
On April 12, 2006, with approval of the Board of Directors, the Company
entered into a Stock Purchase Agreement with Innovative Strategies, a Panama
Company, for the sale to Innovative Strategies of up to 1,000,000 shares of the
Company's Common Stock, at irregular intervals, on a best efforts basis, at US
$1.00 per share. As of the date of this filing, the Company has sold 12,750
shares for a net to the Company of $12,750. All shares as sold are subject to
Regulation S under which the Company has claimed an exemption from registration.
The facts relied upon to claim an exemption under Regulation S are: (1) the
offer and sale of the shares was made in an offshore transaction because the
purchaser was an entity outside of the United States when the purchases were
made, (2) there were no directed selling efforts because the shares were sold to
a single entity and the consideration of activities to condition the market with
respect to the stock being sold was inapplicable. The Company comes within the
Category 2 safe harbor as set forth in Rule 903(c)(2) because the sale of the
common stock complies with the general conditions of Rule 903(a) and (b) and the
stock certificates bear restrictive legends that meet the Regulation S selling
restrictions in terms of transactional restrictions and offering restrictions.
This Agreement with Innovative Strategies is ongoing.
ITEM 2. EXHIBITS
(a) INDEX TO EXHIBITS
Exhibit Number Page Number Description
-------------- ----------- -----------
3(i)(a) *Articles of Incorporation of
Media Advisory Group, Inc.
3(i)(b) *Certification of
Reinstatement
3(i)(c) *Articles of Amendment
changing name to I & E
Tropicals, Inc.
3(i)(d) **Articles of Amendment
changing name to Viridax
Corporation
3(ii) *Bylaws of Viridax Corporation
10 **Asset Purchase Agreement
14 **Code of Ethics
31.1 E-1 Certification by President
31.2 E-3 Certification by Chief
Financial Officer
32.1 E-5 Certification, 18 U.S.C.
32.2 E-6 Certification, 18 U.S.C.
*Incorporated by reference to Form 10-SB/12G, filed 1/7/02.
**Incorporated by reference to Form 10-KSB, filed on 6/27/05.
(b) REPORTS ON FORM 8-K
None.
7
SIGNATURES
In accordance with the Exchange Act, the registrant caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
Dated: September 11, 2006 By: /s/ Richard C. Honour
---------------------------
Name: Richard C. Honour
Title: President
In accordance with the Exchange Act, this report has been signed below by
the following persons on behalf of the registrant and in the capacities and on
the dates indicated.
/s/ Richard C. Honour President and Director
- --------------------------
Richard C. Honour
/s/ Ledyard H. DeWees Secretary
- --------------------------
Ledyard H. DeWees
/s/ Michael C. Maloney Director
- --------------------------
Michael C. Maloney
/s/ Javaid Sheikh Director
- --------------------------
Javaid Sheikh
/s/ Brett L. DeWees Director
- --------------------------
Brett L. DeWees
/s/ Kenneth E. Lehman Chief Financial Officer
- -------------------------- Director
Kenneth E. Lehman
8